Ingredion Incorporated Reports Strong Second Quarter 2012 Results
(Thomson Reuters ONE) -
* Second quarter 2012 reported EPS rose 39 percent to $1.40 from $1.01 in the
second quarter 2011
* Second quarter 2012 adjusted EPS increased 21 percent to $1.33 from $1.10
* Year-to-date 2012 reported EPS of $2.61 compared to $2.97 (which included
$0.75 per share NAFTA settlement) in the year-ago period
* Year-to-date 2012 adjusted EPS of $2.59 compared to $2.37 in the year-ago
period
* Company maintains full year 2012 adjusted EPS guidance of $5.00 to $5.25
WESTCHESTER, Ill., July 31, 2012 - Ingredion Incorporated (NYSE: INGR), a
leading global provider of ingredient solutions to diversified industries, today
reported results for the second quarter 2012.
"We delivered a strong second quarter in spite of some macroeconomic volatility
and this should set us up to achieve our full year guidance," said Ilene Gordon,
chairman, president and chief executive officer. "Our second quarter earnings
per share was the highest adjusted quarterly result in our company's history.
Underlying this performance are volume improvement and manufacturing
efficiencies as well as appropriate price increases to cover higher raw material
costs and foreign exchange headwinds. We continue to have a positive outlook
for 2012 and expect sales and adjusted EPS improvement compared to 2011.
"Our business model has proven resilient and has mitigated some of the
volatility we've faced while allowing us to still generate volume and EPS
growth," Gordon added.
Earnings per share (EPS)
Second quarter diluted EPS rose 39 percent to $1.40 compared to $1.01 last
year. The second quarter of 2012 included a $0.16 per share benefit from the
release of a Korean deferred tax valuation allowance that was partially offset
by $0.08 of restructuring and impairment charges and $0.01 of business
integration costs. The second quarter of 2011 included $0.07 of integration
costs and $0.02 of restructuring charges. Excluding these items, adjusted EPS
increased 21 percent from $1.10 to $1.33 in the quarter. The estimated drivers
of the increase in 2012 adjusted EPS were $0.25 from margin, $0.03 from higher
volumes, and $0.03 of non-operational items partially offset by $0.08 from
currency headwinds.
First half diluted EPS fell 12 percent to $2.61 compared to $2.97 last year.
The first half of 2012 included a $0.16 per share benefit from the release of a
Korean deferred tax valuation allowance that was largely offset by $0.11 of
restructuring and impairment charges and $0.03 of business integration costs.
The first half of 2011 included a $0.75 gain from a NAFTA settlement with the
government of Mexico, partially offset by $0.13 of integration costs and $0.02
of restructuring charges. Excluding these items, adjusted EPS increased 9
percent from $2.37 to $2.59 in the first half.
Financial Highlights
· During the second quarter of 2012, net financing costs were $17
million versus $19 million in the year-ago period. The decrease primarily
reflects favorable foreign currency transactions.
* At June 30, 2012, total debt and cash and cash equivalents were $1.84
billion and $440 million, respectively, versus $1.95 billion and $401
million, respectively, at December 31, 2011.
* In the first half of 2012, cash flow from operations was $318 million
compared to $102 million in the year-ago period.
* Capital expenditures, net of disposals, were $128 million in the first half
of 2012 compared to $89 million in the same period of 2011.
* On July 23, the Company announced that it will restructure its operations in
Kenya and close its plant in Eldoret. In the second quarter, the Company
recorded an after-tax charge of $4 million, or $0.05 per share, related to
this restructuring.
Business Review
North America
+--------------+-------------+---------+------+---------+-------------+--------+
|$ in millions | 2011 Net |FX Impact|Volume|Price/mix| 2012 Net |% change|
| | sales | | | | sales | |
+--------------+-------------+---------+------+---------+-------------+--------+
|Second quarter| 853 | -6 | 47 | 56 | 950 | +11% |
+--------------+-------------+---------+------+---------+-------------+--------+
|Year-to-date | 1,632 | -8 | 85 | 133 | 1,842 | +13% |
+--------------+-------------+---------+------+---------+-------------+--------+
Second quarter
* Volume up due to strong sales to the soft drink and brewing industries.
* Strong price/mix included sufficient price increases to cover higher input
costs.
* Operating income was up 38 percent, or $27 million, from $70 million to $97
million.
* Both volume and operating income growth reflect the absence of a significant
maintenance project at the Company's largest facility in the year-ago
quarter. The project had a $13 million unfavorable impact on second quarter
2011 operating income.
Year-to-date
· Volume rose due to strong sales to the soft drink and brewing
industries.
· Strong price/mix included sufficient price increases to cover higher
raw material costs.
· Operating income rose 15 percent from $171 million to $197 million.
South America
+--------------+-------------+---------+------+---------+-------------+--------+
|$ in millions | 2011 Net |FX Impact|Volume|Price/mix| 2012 Net |% change|
| | sales | | | | sales | |
+--------------+-------------+---------+------+---------+-------------+--------+
|Second quarter| 390 | -46 | -9 | 14 | 349 | -11% |
+--------------+-------------+---------+------+---------+-------------+--------+
|Year-to-date | 758 | -63 | -22 | 44 | 717 | -5% |
+--------------+-------------+---------+------+---------+-------------+--------+
Second quarter
* Volumes soft due to a combination of weaker economic activity in the region
as well as a transportation strike and labor negotiations impacting our
customers in Argentina.
* Positive price/mix and lower corn costs helped offset higher energy costs
and foreign exchange.
* Operating income in the quarter was $47 million, down 1 percent from $48
million.
Year-to-date
* Volumes soft due to a combination of weaker economic activity in the region
as well as a transportation strike and labor negotiations impacting our
customers in Argentina.
* Positive price/mix and lower corn costs helped offset higher energy costs
and foreign exchange.
* Operating income was $93 million, down 4 percent from $97 million in the
year-ago period.
Asia Pacific
+--------------+-------------+---------+------+---------+-------------+--------+
|$ in millions | 2011 Net |FX Impact|Volume|Price/mix| 2012 Net |% change|
| | sales | | | | sales | |
+--------------+-------------+---------+------+---------+-------------+--------+
|Second quarter| 201 | -8 | 9 | 6 | 208 | +3% |
+--------------+-------------+---------+------+---------+-------------+--------+
|Year-to-date | 383 | -7 | 8 | 13 | 397 | +4% |
+--------------+-------------+---------+------+---------+-------------+--------+
Second quarter
* Sales growth was driven by strong volumes in Thailand and improved price/mix
in South Korea, which more than offset foreign exchange headwinds.
* Operating income of $23 million was essentially flat in the second quarter
as higher volume and pricing were offset by higher costs.
Year-to-date
* Sales growth was driven by strong volumes in Thailand and improved price/mix
in South Korea.
* Operating income rose 5 percent from $41 million to $43 million. The trend
of higher volume and pricing offsetting costs continued.
Europe, Middle East, Africa (EMEA)
+--------------+-------------+---------+------+---------+-------------+--------+
|$ in millions | 2011 Net |FX Impact|Volume|Price/mix| 2012 Net |% change|
| | sales | | | | sales | |
+--------------+-------------+---------+------+---------+-------------+--------+
|Second quarter| 140 | -11 | -5 | 4 | 128 | -9% |
+--------------+-------------+---------+------+---------+-------------+--------+
|Year-to-date | 270 | -16 | -13 | 13 | 254 | -6% |
+--------------+-------------+---------+------+---------+-------------+--------+
Second quarter
* Sales fell by $12 million due to currency devaluations and soft volume.
* Operating income fell 13 percent, or $3 million, in the quarter from $22
million to $19 million due primarily to foreign exchange headwinds, softer
volumes and higher costs partially offset by improved pricing.
Year-to-date
* Sales fell by $16 million due to currency devaluations, Pakistan's on-going
energy issues and continued economic weakness in Europe, which all impacted
volumes.
* Operating income fell 14 percent from $44 million to $38 million due
primarily to volume softness, currency headwinds and higher energy costs.
2012 Guidance
Reported EPS expectations for 2012 are in a range of $4.87 to $5.12. The
guidance includes an anticipated $0.29 per share of acquisition integration and
restructuring charges for the full year offset by a $0.16 per share benefit from
the reversal of a deferred tax valuation allowance. Excluding those anticipated
charges and benefit, adjusted EPS for 2012 is expected to be in a range of $5.00
to $5.25, an increase of 7 percent to 12 percent compared to 2011 adjusted EPS.
Adjusted EPS guidance is unchanged.
The effective tax rate for 2012 is estimated to be between 31 percent and 33
percent, which excludes discrete items.
Capital expenditures in 2012 are anticipated to be between $275 million and $325
million and should support growth investments across the organization,
particularly in North America, South America and EMEA.
Conference Call and Webcast
Ingredion will conduct a conference call today at 8:00 a.m. Eastern Time (7:00
a.m. Central Time) to be hosted by Ilene Gordon, chairman, president and chief
executive officer, and Cheryl Beebe, chief financial officer.
The call will be broadcast in a real-time webcast. The broadcast will consist of
the call and a visual presentation accessible through the Ingredion web site at
www.ingredion.com. The presentation will be available to download approximately
60 minutes prior to the start of the call. A replay of the webcast will be
available at www.ingredion.com.
ABOUT THE COMPANY
Corn Products International, Inc. is now Ingredion Incorporated (NYSE:INGR). The
Company is a leading global ingredients solutions provider specializing in
nature-based sweeteners, starches and nutrition ingredients. With customers in
more than 40 countries, Ingredion serves approximately 60 diverse sectors in
food, beverage, brewing, pharmaceuticals and other industries. For more
information, visit ingredion.com.
Forward-Looking Statements
This news release contains or may contain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. The Company intends
these forward-looking statements to be covered by the safe harbor provisions for
such statements.
Forward-looking statements include, among other things, any statements regarding
the Company's prospects or future financial condition, earnings, revenues, tax
rates, capital expenditures, expenses or other financial items, any statements
concerning the Company's prospects or future operations, including management's
plans or strategies and objectives therefor and any assumptions, expectations or
beliefs underlying the foregoing.
These statements can sometimes be identified by the use of forward looking words
such as "may," "will," "should," "anticipate," "believe," "plan," "project,"
"estimate," "expect," "intend," "continue," "pro forma," "forecast" or other
similar expressions or the negative thereof. All statements other than
statements of historical facts in this release or referred to in this release
are "forward-looking statements."
These statements are based on current expectations, but are subject to certain
inherent risks and uncertainties, many of which are difficult to predict and are
beyond our control. Although we believe our expectations reflected in these
forward-looking statements are based on reasonable assumptions, stockholders are
cautioned that no assurance can be given that our expectations will prove
correct.
Actual results and developments may differ materially from the expectations
expressed in or implied by these statements, based on various factors, including
the effects of global economic conditions, including, particularly, continuation
or worsening of the current economic conditions in Europe, and their impact on
our sales volumes and pricing of our products, our ability to collect our
receivables from customers and our ability to raise funds at reasonable rates;
fluctuations in worldwide markets for corn and other commodities, and the
associated risks of hedging against such fluctuations; fluctuations in the
markets and prices for our co-products, particularly corn oil; fluctuations in
aggregate industry supply and market demand; the behavior of financial markets,
including foreign currency fluctuations and fluctuations in interest and
exchange rates; continued volatility and turmoil in the capital markets; the
commercial and consumer credit environment; general political, economic,
business, market and weather conditions in the various geographic regions and
countries in which we buy our raw materials or manufacture or sell our products,
including continuation or worsening of the current severe drought conditions in
the U.S.; future financial performance of major industries which we serve,
including, without limitation, the food and beverage, pharmaceuticals, paper,
corrugated, textile and brewing industries; energy costs and availability,
freight and shipping costs, and changes in regulatory controls regarding quotas,
tariffs, duties, taxes and income tax rates; operating difficulties;
availability of raw materials, including tapioca and the specific varieties of
corn upon which our products are based(availability of specific varieties of
corn upon which certain of our products are based will be impacted by current
severe drought conditions in the U.S., which both reduce yields and increase the
corn plants' susceptibility to disease); energy issues in Pakistan; boiler
reliability; our ability to effectively integrate and operate acquired
businesses, including National Starch; our ability to achieve budgets and to
realize expected synergies; our ability to complete planned maintenance and
investment projects successfully and on budget; labor disputes; genetic and
biotechnology issues; changing consumption preferences including those relating
to high fructose corn syrup; increased competitive and/or customer pressure in
the corn-refining industry; and the outbreak or continuation of serious
communicable disease or hostilities including acts of terrorism.
Our forward-looking statements speak only as of the date on which they are made
and we do not undertake any obligation to update any forward-looking statement
to reflect events or circumstances after the date of the statement as a result
of new information or future events or developments. If we do update or correct
one or more of these statements, investors and others should not conclude that
we will make additional updates or corrections. For a further description of
these and other risks, see "Risk Factors" included in our Annual Report on Form
10-K for the year ended December 31, 2011 and subsequent reports on Forms 10-Q
and 8-K.
CONTACT:
Investors: Aaron Hoffman, 708-551-2592
Media: Claire Regan, 708-551-2602
2Q 2012 PR Tables - FINAL:
http://hugin.info/147221/R/1630618/522600.pdf
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Ingredion Incorporated via Thomson Reuters ONE
[HUG#1630618]
Unternehmensinformation / Kurzprofil:
Datum: 31.07.2012 - 11:58 Uhr
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News-ID 170262
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